Obama, Vilsack Cave on Farm Payment Limit Reform

Candidate Obama’s farm policy platform had as its very first item lowering the limits and closing the loopholes that allow mega farms evade even the high dollar limits authorized by the farm bill. On Thursday, January 7, USDA published the payment limitation final rule. The President did a complete about face, leaving the status quo in place and leaving his campaign pledge in tatters.

The rule is effective immediately and, barring a second major about face, effectively kills the prospect for farm subsidy reform during at least the first term of the Obama Presidency. The future, sadly, will look like the past — taxpayer financing worth hundreds of thousands of dollars a year to mega farms, subsidizing their ability to dominate the land market, drive up land values, and close off farming opportunities for small and mid-scale farms and beginning farmers.

Never before in history did an Administration that said it was committed to real reform have the opportunity presented to this President. In passing the 2008 Farm Bill, Congress, in lieu of reaching a compromise on the issue itself, directed the Administration to rewrite payment limitation rules to deal with the problematic “actively engaged in farming” rules that theoretically exist to direct payments to real, working farmers and to restrict fraud and abuse.

The Bush Administration published an interim rule in December 2008 that included minor but ultimately ineffective steps in a reformist direction. While Bush nibbled around the edges of reform, Obama promised real reform and an end to government-sanctioned loopholes that allow and encourage what otherwise could only be considered fraud. The table was set – a farm bill directive, a Bush interim rule that took some baby steps, and nearly a full year for USDA to work out the details of the Obama campaign promise to once and for all close the loopholes. The meal that was served, however, was the status quo ante.

Rumors are rampant that the reversal may have been based on highest-level negotiations with specific Senators over the health care bill. Whether those are true or not, we may never know.

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